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Strong retail sales growth marks consumer resilience: NRF
05 Nov '20
2 min read
Pic: Shutterstock
US retail sales have largely recovered from the pandemic, heading into the holiday season but the growing number of coronavirus cases remains a threat and additional federal stimulus could help keep the economy on track, according to National Retail Federation (NRF) chief economist Jack Kleinhenz, who recently said strong growth in retail sales during the last few months points to consumer resilience.
“Taking in all the evidence available, the U.S. economic recovery has progressed more quickly than generally expected,” Kleinhenz said. He agreed with Federal Reserve chairman Jerome Powell’s recent call for additional federal stimulus, which the chairman said ‘will not go to waste’ even if it is more than necessary.
“While there might be sufficient momentum and resiliency to propel the economy in the months ahead, additional fiscal policy support is critical to ensure that the recovery doesn’t stall,” Kleinhenz said.
Kleinhenz’s remarks came in the November issue of NRF’s ‘Monthly Economic Review’, which noted that retail sales have been up both month-over-month and year-over-year each month since June. Retail sales have completed a V-shaped recovery and are up 8.6 percent since January, according to data from Harvard University’s Opportunity Insights research project.
Household spending on retail goods has helped bring back overall consumer spending, which was down 16.1 per cent year-over-year in April but only 1.9 percent as of August, according to the Commerce Department, NRF said in a press release.
The report pointed to increased disposal personal income, which was up 5.4 per cent year-over-year as of August, and a savings rate of 14.4 per cent that has remained in double digits for six straight months.
Even though government stimulus has tapered off, “savings are available if consumers decide to spend more aggressively,” Kleinhenz said. Consumer confidence remains below pre-pandemic levels but is rising.
“Taking in all the evidence available, the U.S. economic recovery has progressed more quickly than generally expected,” Kleinhenz said. He agreed with Federal Reserve chairman Jerome Powell’s recent call for additional federal stimulus, which the chairman said ‘will not go to waste’ even if it is more than necessary.
“While there might be sufficient momentum and resiliency to propel the economy in the months ahead, additional fiscal policy support is critical to ensure that the recovery doesn’t stall,” Kleinhenz said.
Kleinhenz’s remarks came in the November issue of NRF’s ‘Monthly Economic Review’, which noted that retail sales have been up both month-over-month and year-over-year each month since June. Retail sales have completed a V-shaped recovery and are up 8.6 percent since January, according to data from Harvard University’s Opportunity Insights research project.
Household spending on retail goods has helped bring back overall consumer spending, which was down 16.1 per cent year-over-year in April but only 1.9 percent as of August, according to the Commerce Department, NRF said in a press release.
The report pointed to increased disposal personal income, which was up 5.4 per cent year-over-year as of August, and a savings rate of 14.4 per cent that has remained in double digits for six straight months.
Even though government stimulus has tapered off, “savings are available if consumers decide to spend more aggressively,” Kleinhenz said. Consumer confidence remains below pre-pandemic levels but is rising.
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